Posts Tagged ‘Call centers’

Check out this video of Steve Jobs talking about the origins of the iPad.

The text that appears as Jobs talks is how a computer program developed by a firm called Beyond Verbal is interpreting Jobs’ emotion. That is, the program is judging whether Jobs is feeling fatigue or nostalgia based not on what is saying but how he is saying it.

Kinda nifty, but does it have commercial applications? The claim is yes and it is in call centers.


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American Express runs its call centers differently. No scripts. No high pressure on handle times. Instead, they put a focus on relating to customers and evaluate agents on how the customers they interact with answer the question “Would you recommend this company to a friend?” Fortune has an interview with Jim Bush, American Express’ EVP of world service, who has overseen this change (How can American Express help you?, Apr 19). (Dedicated readers of this blog with long memories might recall that we posted on this about a year and a half ago.)

He makes some interesting points on their philosophy in running customer service — starting with the fact that they view call centers as serving customers, not processing transactions.

The perception of service is that it’s all about problems. Problems are actually a very small percentage of why customers interact with American Express. What we’ve learned is that the power of that interaction gives us an opportunity to expand the perception of the brand in a very positive way.

There’s a tendency to see service as a sunk cost — the customer is reaching out to you. So people say, “It’s a cost. Let’s look to eliminate it.” And over time we can eliminate friction points, which eliminates the need for some customers to interact with us. But the reality is, it’s a very powerful opportunity to build a relationship.


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So which country is a bigger market for off-shored technology services, India of the Philippines? According to Market Watch, the latter is the answer (Philippines lifted by outsourcing boom, Jun 15).

The Philippines’ fast-growing business-process outsourcing industry has turned the Asian nation into a major center for off-shored information tech services. The country recently passed India as the world’s top outsourcing destination, according to a report by the services arm of International Business Machines IBM +1.09% — which has a major presence in the country. …

“Ten years ago, we had maybe about 25,000 people in the industry,” said Jose Mari Mercado, business development director at Convergys in the Philippines, who said that number reached about half a million last year.

“The interest in the Philippines has really grown tremendously in the last five years,” he added.

While business outsourcing is typically associated with call centers, the industry actually covers a range of IT services, including customer relations, human resources, accounting and even more specific functions, such as mortgage processing.

In 2010, the Philippines’ IT and business process outsourcing grew 26% to $8.9 billion, according to the Business Processing Association of the Philippines. Workers and professionals employed by the industry grew by 24%, the industry association said.


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We have had a couple of recent posts about firms trying to get more out of their call centers through psychometric data. The idea is that by classifying both customers and agents along psychometric dimensions, the firm can route callers of a particular characteristic to the type of agent that is most likely to lead to a good outcome (where “good” is presumably defined based on what the firm wants). I have to admit that I am not overly familiar with what psychometric measures they are using and am not sure how well they can measure these with infrequent customer contact. At some level, this starts to sound like whether a libra should date a taurus.

With that background, I found a recent Sloan Management Review article really fascinating (Matchmaking With Math: How Analytics Beats Intuition to Win Customers, Winter 2011). It is an interview with Cameron Hurst, a VP at Assurant Solutions. Assurant Solutions sells credit insurance. You pay them every month and then if you are, say, laid off they help cover your credit card bills. What customers pay ranges from $10 to $80 per month and it is not hard to see that some people may have second thoughts about paying that. What seemed like a good idea six months ago might not seem worth $20 now. Hence, their call center plays a key role in keeping customers. When customers get cold feet, it is up to call center agents to “re-sell” them on the product and retain the business. And that is where “affinity routing”  comes in. They brought in some business analytics experts who already worked in the firm but doing actuarial work and such and asked them to look at the call center.

The first thing that was interesting about their approach was that rather than thinking about the average speed of answering phone calls, or the average “handle time,” or service level metrics, or individual customer experiences or using QA tools to find out what we did right and what we did wrong — all the things we usually consider when looking at customer and representative interaction — they started thinking of it purely from the perspective of, “We’ve got success and we’ve got failure.”

Success and failure are very easy things to establish in our business. You either retained a customer calling in to cancel or you didn’t. If you retained them, you did it by either a cross-sell, up-sell or down-sell.

So this is what they started asking: What was true when we retained a customer? What was true when we lost a customer? What was false when we retained a customer? And what was false when we lost a customer? For example, we learned that certain CSRs generally performed better with customers in higher premium categories while others did not. These are a few of the discoveries we made, but there were more. Putting these many independent variables together into scoring models gave us the basis for our affinity-based routing.


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From Belgium, a creative approach to exacting some revenge on a telecom provider with a disappointing customer service record. Reading the subtitles is pretty amusing. Judging by how much the Belgian in the office next to me laughed, the Flemish is just hilarious.


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Fast Company had an interesting article on the technology being pushed by firm called eLoyalty to improve call center operations (How a Personality Test Designed to Pick Astronauts is Taking the Pain Out of Customer Support, Dec 1). The roots of this approach date to a methodology developed by a clinical psychologist to categorize personality types.

The methodology, called the Process Communication Model, was created in the 1970s by a clinical psychologist named Taibi Kahler. He divided people into six main personality types, each of which has a different communication style and each of which has different stress triggers. If you know the personality type of the person you’re speaking with, Kahler explained, you can modify your own communication style to work more effectively with them, prevent misunderstandings, and avoid inadvertently pushing the other person’s buttons.

Apparently, this approach has been used by NASA to determine who’s got the right stuff to for space missions. But how does this apply to call centers?

In call centers, eLoyalty’s system uses the PCM framework to compile a personality profile of each caller from the moment they first contact the center. The system, which is automated, analyzes the caller’s language patterns and other behavioral cues to identify their personality type. (A team of 250 linguists, behavioral scientists, and statisticians have compiled a massive set of linguistic libraries and behavioral algorithms to parse callers’ every word and mode of expression.)

Each time the customer calls back, the system uses the existing profile to steer them to a customer service representative who’s the best match for their personality type, and it continues to analyze their subsequent conversations to deepen and enrich their profile.

eLoyalty, which has clients in the banking, health care, and insurance industries, among others, is the only organization in the call center industry licensed to use PCM. Typical call center quality assurance programs train reps in specific issues and rely on supervisors listening in to a small percentage of calls, and providing coaching to individual reps. The automated eLoyalty system not only allows a larger proportion of calls to be analyzed, but it moves coaching out of the realm of intuition and grounds it in evidence about how to communicate effectively.


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I am getting geared up for teaching my service operations elective this fall. I was consequently intrigued when a colleague forwarded a New Yorker essay to me on the “crisis” in customer service (Are You Being Served?, Sept 6). The article unfortunately is fundamentally disappointing. It begins with discussing the response to Steven Slater, the irate Jet Blue flight attendant, and noting that customer service workers are “frustrated … with stagnant pay, stressful working conditions, and obnoxious customers.” It then moves to observing that “everyone knows that the contemporary customer is mad as hell, too—fed up with inept service, indifferent employees, and customer-service departments that are harder to negotiate than Kafka’s Castle” before asking “When it comes to customer service, it seems, people are unhappy no matter what side of the counter they’re on. Why can’t we get it right?”

The analysis that follows then isn’t much. Yes, customer service is generally managed as a cost center, and that is going to put a premium on efficiency over pampering. Yes, companies are usually eager for growth and that means they are going to be scouting for the next customer as much looking after the ones they have. But that all seems old hat. One of the most basic frameworks in service management is the service profit chain. It is built off the idea that customer loyalty is the driver of profitability. It’s a useful way of thinking about some issues but I have been sorely tempted to drop it from my course because by the time I have students in the elective they are so tired of hearing this point. I start by noting that loyalty matters and they roll their eyes and start to doze off.

So what then is the way out of this customer service crisis? (more…)

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Last week, the Financial Times had an article claiming that call center costs have fallen enough in the US that they were getting close to matching the costs in India (US matches Indian outsourcing costs, Aug 17). This garnered enough attention that it was even parodied in the Onion. As the FT tells it, there are two sides to this cost comparison. On the one hand, the recession has suppressed wages here. On the other it is getting more expensive to operate in India.

Pramod Bhasin, the chief executive of Genpact, said his company expected to treble its workforce in the US over the next two years, from about 1,500 employees now.

“We need to be very aware [of what’s available] as people [in the US] are open to working at home and working at lower salaries than they were used to,” said Mr Bhasin. “We can hire some seasoned executives with experience in the US for less money.”

The narrowing of the traditional cost advantage is also spurring other Indian outsourcers to hire more staff outside India. Wipro, the Bangalore-based IT outsourcing company, started to recruit workers in Europe, the Middle East and Africa during the global economic downturn. Suresh Vaswani, joint chief executive of Wipro Technologies, forecasts that half of his company’s overseas workforce will be non-Indians in two years, from the current 39 per cent.

Now NPR adds a little more detail (Outsourced Call Centers Return, To U.S. Homes, Aug 25)

Phil Fersht, an outsourcing analyst, says even before the recession started, companies were starting to realize that offshoring wasn’t the best option for other services. In some cases, workers in India are making only about 15 percent less than workers in Nebraska, he says. That’s the threshold where companies start thinking about whether it’s worth it to hire an American worker instead of a foreign one.


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What would you give to get out of line?  Disney figured this out with its Fast Pass program a decade or so ago. It lets Disney park visitors to wait in a virtual queue — they can wander the park and do other things instead of waiting in line for a given ride. The system gives them a specific window in which to return. Disney very quickly found that in-park spending and guest satisfaction went up with Fast Pass.

So why can’t you do something similar when, say, you get put on hold calling the cable company. Now you sort of can thanks to a start up called LucyPhone. Here’s the crazy thing: Consumer choose to use this service when calling and (for the moment) it is not on the firm’s initiative. Here’s how the LucyPhone explains its service:

How LucyPhone Works

Lucy will call you first then “patch” you through to the company.

Use the company’s phone menu just as you normally would. Get put on hold? Press ** and your phone will be disconnected but Lucy will stay on the line.

Once a live agent is on the line, Lucy will call you back immediately and connect you both. Get put on hold again, just press ** again!


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I am the first to admit that it is hard to feel sorry for cellphone companies. However, I must admit there is an industry trend that is really going against them and creating a real operational challenge. Specifically, smart phones are where the action is at in the mobile telecom industry and that is dramatically changing the nature of tech support firms must provide (Smart phones raise stakes for telcos, May 19, Globe and Mail).

Welcome to customer service in the smart-phone era. As cellphones become as complicated as computers, answering customer complaints is no longer a matter of simply reminding customers which buttons to push. It’s become a full-scale – and expensive – technology consultation, in which customer service agents like Mr. Singh are called upon to diagnose software and hardware glitches that can take hours to untangle.

An average service call costs a wireless company $5 to $12 to handle, while the fee for a complicated, lengthy call can soar to $30 or more. Yet Canada’s biggest wireless companies have no choice but to improve their customer service or risk losing customers to new wireless entrants.

“Smart phones are driving more calls per client and longer calls per client. And I’d say that’s a general industry challenge,” says Cameron McCuaig, who has been vice-president of client care at Bell Mobility for seven years. “In essence, we’re in the computer business now with all the functionality that you get in a smart phone.”

To put these numbers in perspective, my cellphone provider charges about $30 per month for data access.  This says that one or two calls about getting to my email or getting some app to work and they are taking a loss on my data plan.

Oddly tempting, I know.


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